Survey Shows That Smart Home Prices Still Need “Smarts”

Device and system take-up stalled by higher prices

April 10, 2018 09:00 AM Eastern Daylight Time

NEW YORK--(BUSINESS WIRE)--While industry analysts and forecasters continue to talk up the smart
home market – predicting global revenues of $40bn
by 2020 – the evidence suggests that high prices means the US public
remains strangely reluctant to fully jump aboard the smart home
bandwagon. Today, 151 Advisors, a global consultancy firm specializing
in the Internet of Things (IoT) and real-world go-to-market strategies,
released a survey
focused on Smart Homes.

In the last five years, for example, American smart home
security sales have only grown by 20 percent in what should have
been a boom era for the industry. Sales of $3.92bn in 2012 only inched
up their way to $4.69bn last year - with 2016 to 2017 growth almost
stalling at less than two percent.

So, when a survey
shows that price remains the number one consideration – chosen by more
than 40 percent of consumers - when considering smart devices and
systems for the home, then the industry better sit-up and take notice.

To put a number on it – more than half of those surveyed would balk at
paying more than $40 more for a smart door lock for their home compared
to a conventional one. Indeed, only five percent polled by IoT
consultants 151 Advisors, would pay a $100 premium for smart security in
their home.

Today, nearly 85 percent of those surveyed said they considered less
than 20 percent of their home to “be smart” and an even smaller
percentage even wanted their homes to be “smart” within the next 12
months.

In fact, when it comes to smart home choices, it seems entertainment
still trumps security. Aside from mobiles and tablets, the most common
smart device in a US home is a television - found in 40 percent of the
homes of those surveyed, and that’s four times as many as those owning a
connected security system.

If the manufacturers can get the prices down to the right level, the
underlying market interest is strong. 27 percent of those surveyed said
they had thought about buying a smart lock or smart security system,
another 23.5 percent a smart thermostat, and 21 percent a smart device
such as Google Home or Amazon Echo. The only thing preventing those
consumers buying – the price.

“For the US smart home market to really take off,” said Steve Brumer,
Partner of 151 Advisors, “then the prices have to fall, and the smart
home premium needs to be closer to $20 than $50.”

151 Advisors is the leading IoT consulting firm that provides companies
across all industries with real-world go-to-market strategy and
execution services that monetize the connected world. Our expertise is
built on decades of helping enterprises and vendors define, execute, and
accelerate their market positions to drive commercial success. Learn
more about our team, capabilities, and experience at www.151Advisors.com.
Also, follow us on Twitter and LinkedIn.